OPTION AGREEMENT

            OPTION AGREEMENT, dated as of March 14, 1997 and amended on January
14, 1998, between The Los Angeles Individualized Television Network, Inc., a
Delaware corporation (the "Corporation") and William Samuels (the "Holder").

            WHEREAS, the Corporation desires to grant to the Holder, the right
and option to purchase shares (the "Option Shares") of Class B Common Stock,
$.01 par value per share (the "Class B Stock"), of the Corporation, on the terms
and subject to the conditions hereinafter set forth.

            NOW, THEREFORE, in consideration of the receipt of $1.00 and other
good and valuable consideration, the receipt of which is hereby acknowledged,
the parties hereby agree as follows:

            SECTION 1.  Option to Purchase Common Stock.

                  a. The Corporation hereby grants to the Holder an option (the
"Option") to purchase from the Corporation 250,000 Option Shares, at a purchase
price of $1.55 per Option Share (the "Option Price"). The Holder's right and
option to purchase the Option Shares shall vest, subject to subsection 1(d) and
Section 6, as follows: (i) 85,000 Option Shares vest July 1, 1997, (ii) 55,000
Option Shares vest on January 1, 1998, (iii) 55,000 Option Shares vest July 1,
1998; (iv) 50,000 Option Shares vest January 1, 1999 (each an "Installment") at
the Option Price, so long as the Holder is employed by the Corporation, ACTV,
Inc. or any affiliate or subsidiary of ACTV, Inc. (collectively, the "ACTV
Group"). Said right shall be cumulative. With respect to each Installment, the
"Option Period" shall commence on the date said Installment vests and terminate
on March 14, 2007.

                  b. Except as limited by Section 5,an Installment may be
exercised, in whole or part, by the Holder by delivery to the Corporation, at
any time during the Option Period, of a written notice (the "Option
Notice"), which Option Notice shall state the Holder's intention to exercise the
Option, the date on which the Holder proposes to purchase the Option Shares (the
"Closing Date") and the number of Option Shares to be purchased on the Closing
Date, which Closing Date shall be no later than 30 days nor earlier than 10 days
following the date of the Option Notice. Upon receipt by the Corporation of an
Option Notice from

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the Holder, the Holder shall be obligated to purchase that number of Option
Shares to be purchased on the Closing Date set forth in the Option Notice.

                  c. The purchase and sale of Option Shares acquired pursuant to
the terms of this Option Agreement shall be made on the Closing Date at the
offices of the Corporation. Delivery of the stock certificate or other
instrument registered in the name of the Holder, evidencing the Option Shares
being purchased on the Closing Date, shall be made by the Corporation to the
Holder on the Closing Date against the delivery to the Corporation of a
certified or bank check in the full amount of the aggregate purchase price
therefor.

                  d. After January 1, 1999, the option shares may be exchanged,
in whole or in part for an equal number of ACTV, Inc. common shares assuming the
Corporation has been capitalized with a minimum of $5 million dollars of equity
or debt financing and is a subsidiary of ACTV Entertainment. The total option
and exchange price per share of ACTV, Inc. common shares shall be at a minimum
the ACTV, Inc. closing price on the date to which the financing referred to in
the preceding sentence is consummated.

                  e. Should ACTV, Inc. ("ACTV") undergo a Change in Control, as
defined below, or should another corporation which can exercise control over the
Corporation sell or attempt to sell all or substantially all of the assets of
said Corporation, or should more than 50% of its voting power be acquired by a
party which is not affiliated with or controlled by ACTV, then all of the
Holder's rights to exercise the Option for all the Option Shares shall be
accelerated so that the Installments to purchase all Option Shares shall be
fully vested at the time of said event and the total of the option exercisable
and exchange price shall reduce to $.10 per share. A Change in Control shall be
the occurrence of any one of the following events:

                        (i) A person (other than a person who is an officer or a
Director of ACTV on the effective date hereof), including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, becomes, or obtains
the right to become, the beneficial owner of ACTV's securities having 30% or
more of the combined voting power of then outstanding securities of ACTV that
may be cast for the election of directors of ACTV;


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                        (ii) At any time, a majority of the Board-nominated
slate of candidates for the Board of ACTV is not elected;

                        (iii) ACTV consummates a merger in which it is not the
surviving entity;

                        (iv) Substantially all ACTV's assets are sold; or

                        (v) ACTV's stockholders approve the dissolution or
liquidation of ACTV.

            SECTION 2.  Representations and Warranties of The Holder. The
Holder hereby represents and warrants to the Corporation that in the event the
Holder acquires any Option Shares, such Option Shares will be acquired for his
own account, for investment and not with a view to the distribution thereof. The
Holder understands the Option Shares will not be registered under the Securities
Act of 1933, as amended (the "Securities Act"), and that they must be held
indefinitely unless a subsequent disposition thereof is registered under the
Securities Act or the transaction is exempt from registration. The certificate
or certificates representing any Option Shares shall bear the following
restrictive legend:

                  "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
            SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY
            NOT BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE
            DISPOSED OF IN THE ABSENCE OF (i) AN EFFECTIVE REGISTRATION
            STATEMENT UNDER THE SECURITIES ACT OF 1933; OR (ii) TO THE EXTENT
            APPLICABLE, RULE 144 UNDER SUCH ACT (OR SIMILAR RULE UNDER THE
            SECURITIES ACT RELATING TO THE DISPOSITION OF SECURITIES), OR (iii)
            AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY
            SATISFACTORY TO COUNSEL FOR THE ISSUER, THAN AN EXEMPTION FROM
            REGISTRATION UNDER THE SECURITIES ACT IS AVAILABLE. IN ADDITION,
            THIS CERTIFICATE OF STOCK AND SHARES REPRESENTED HEREBY AND


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            HELD SUBJECT TO THE TERMS AND CONDITIONS CONTAINED IN AN AGREEMENT
            BY AND AMONG THE SHAREHOLDERS OF THE CORPORATION AND THE CORPORATION
            DATED AS OF MARCH 6, 1997, AND ALL AMENDMENTS THERETO, AND MAY NOT
            BE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE TERMS AND PROVISIONS
            THEREOF. A COPY OF SUCH AGREEMENT WILL BE FURNISHED BY THE
            CORPORATION UPON REQUEST."

            SECTION 3.  Reorganization; Mergers; Sales; Etc. If, at any time
during the Option Period, there shall be any capital reorganization,
reclassification of the Common Stock (the term "Common Stock" shall mean the
Company's Class A Common Stock and/or the Class B Stock) (other than a change in
par value or from par value to no par value or from no par value to par value or
as a result of a stock dividend or subdivision, split-up or combination of
shares), the consolidation or merger of the Corporation with or into another
corporation or of the sale of all or substantially all the properties and assets
of the Corporation as an entirety to any other corporation or person, the
unexercised and fully vested portion of this Option shall, after such
reorganization, reclassification, consolidation, merger or sale, be exercisable
for the kind and number of shares of stock or other securities or property of
the Corporation or of the corporation resulting from such consolidation or
surviving such merger or to which such properties and assets shall have been
sold to which the Holder would have been entitled if the Holder had held shares
of Class B Stock issuable upon the exercise hereof immediately prior to such
reorganization, reclassification, consolidation, merger or sale. The provisions
of this Section 3 shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers and sales.

            SECTION 4.  Adjustment of Option Shares and Option Price.

                  a. The number of Option Shares subject to this Option during
the Option Period shall be cumulative as to all prior dates of calculation and
shall be adjusted for any stock dividend, subdivision, split-up or combination
of Common Stock.

                  b. The Option Price shall be subject to adjustment from time
to time as follows:
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            If, at any time during the Option Period, the number of shares of
Common Stock outstanding is altered by a stock dividend payable in shares of
Common Stock or by a subdivision or split-up or combination of shares of Common
Stock, then, immediately following the record date fixed for the determination
of holders of shares of Common Stock, entitled to receive such subdivision or
split-up or combination, the Option Price shall be appropriately increased or
decreased and the number of shares of Common Stock issuable upon the exercise
hereof shall be increased or decreased, pursuant to the formula set forth in
Section 4.c.

                  c. Upon each adjustment of the Option Price pursuant to the
provisions of this Section 4, the number of shares of Common Stock issuable upon
the exercise hereof shall be adjusted to the nearest full share of Common Stock
by multiplying a number equal to the Option Price in effect immediately prior to
such adjustment by the number of shares of Common Stock issuable immediately
prior to such adjustment and dividing the product so obtained by the adjusted
Option Price.

                  d. Should additional shares of Class A Common Stock, $.01 par
value, over and abovethe 4,000,000 shares presently authorized, be issued after
the effective date of this Option Agreement, then the number of shares issuable
upon exercise of this Option shall be increased by the same percentage that the
total number of issued Class A Common Stock has been increased.

                  e. The Corporation will use its best efforts to amend its
certificate of incorporation to authorize additional Class B Stock should the
number of shares of Class B Stock issuable upon exercise of the Option be
increased in accordance with the terms of this agreement.

            SECTION 5.  Termination of the Options.

                   a. Termination of Options in General. Subject to subsection
5(b), the Option granted hereby shall terminate and the Option shall no longer
be exercisable after March 14, 2007.
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                   b. Option Rights Upon Death, Disability, Resignation. If a
Holder dies or becomes disabled while employed by the ACTV Group, or resigns
from employment with the ACTV Group prior to his complete exercise of the
Option, the Holder (or his heirs) may exercise his Option at any time during the
option period, to the extent that the Holder was entitled to exercise the Option
at the date such event, and the Class B Stock underlying the Option shall
convert into Class A Stock on the second anniversary of the occurrence of such
death, disability or resignation.

            SECTION 6.  Termination of Employment. In the event that a Holder
is terminated from employment with the ACTV Group for any reason during the
Option Period then (i) all Options granted to the Holder hereunder shall become
vested and immediately exercisable at an exercise and exchange price of $.10 per
share adjusted for any stock splits and capital reorganizations having a similar
effect, subsequent to the effective date hereof, (ii) all Options may be
exercised at any time during the Option Period and (iii) anything herein to the
contrary notwithstanding, the Shares underlying the Options, whether exercised
prior or subsequent to the termination shall not convert to Class A stock except
as set forth in the applicable Shareholder Agreement.

            SECTION 7.  Transfer of Option; Successors And Assigns. This
Agreement (including the Option) and all rights hereunder shall not be
transferable at any time without the prior written consent of the Corporation.
This Agreement and all the rights hereunder shall be binding upon and inure to
the benefit of the parties hereto and their respective successors, approved
assigns and approved transferees.

            SECTION 8.  Notices.  All notices or other communications which are
required or permitted hereunder shall be in writing and sufficient if delivered
personally or sent by registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:


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            If to the Corporation:

            The Los Angeles Individualized Television Network, Inc.
            1270 Avenue of the Americas
            New York, NY  10020

            Attention: Christopher C. Cline

            With a copy to:

            Gersten, Savage, Kaplowitz, Fredericks & Curtin, LLP
            101 East 52 Street
            New York, NY  10022

            Attention:  Wesley C. Fredericks

            If to the Holder, to:

            William Samuels
            171 West 57th Street
            New York, New York 10019

or to such other address as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith. If mailed as
aforesaid, any such communication shall be deemed to have given on the third
business day following the day on which the piece of mail containing such
communication is posted.

            SECTION 9.  Governing Law. This Agreement shall be governed by, and
construed in accordance with the laws of the State of Delaware.

            SECTION 10. Entire Agreement. This Agreement contains the entire
agreement between the parties hereto with respect to the transactions
contemplated herein and supersedes all previously written or oral negotiations,
commitments, representations and agreement.
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            SECTION 11. Amendments and Modifications. This Agreement, or any
provision hereof, may not be amended, changed or modified without the prior
written consent of each of the parties hereto.

            IN WITNESS WHEREOF, the parties hereto have caused this Option
Agreement to be executed and delivered as of the date first above written.

                                    THE LOS ANGELES INDIVIDUALIZED
                                    TELEVISION NETWORK, INC.

                                    By:___________________________

AGREED TO AND ACCEPTED BY
HOLDER:


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Signature


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